Modeling Global Spill-Over of New Product Takeoff

This article examines the global spill-over of foreign product introductions and takeoffs on a focal country’s time-to-takeoff, using a novel data set of penetration data for 8 high tech products across 55 countries. It shows how foreign clout, the susceptibility to foreign influences, and inter-country distances affect global spill-over patterns. The authors find that foreign takeoffs, but not foreign introductions, accelerate a focal country’s time-to-takeoff. The larger the country, the higher its economic wealth, and the more it exports, the more clout it has in the global spill-over process. In contrast, the poorer the country, the more tourists it receives and the higher its population density, the more susceptible it is to global spill-over effects. Cross-country spill-over effects are stronger the closer the countries are to one another, both geographically and economically, but not necessarily in terms of culture. The model the authors develop also quantifies the spill-over between each country-pair, allowing it to be asymmetric.